1. Focus on houses that fit your monthly “comfort zone”
Carmen Pulver, our Senior Real Estate Expert at Your Home Sold Guaranteed Realty, emphasizes the importance of understanding one’s financial capabilities right from the start. “The first step is getting a financing certificate to determine your purchasing power,” Carmen advises. She often begins consultations by asking clients about their current rent and comfort level with that expense to gauge what they might afford in terms of a mortgage.
Carmen helps clients establish a clear budget, guiding them to properties that fit within their financial comfort zone without stretching their limits. “Qualifying for a CHF 1’500’000 mortage doesn’t mean you should strain your budget to the extent where you can’t enjoy life,” she points out. Carmen’s goal is to ensure her clients can purchase a dream home that fits a sustainable budget, allowing them to enjoy everyday activities and maintain a comfortable lifestyle.
2. Negotiate concessions from sellers
In the Swiss real estate market, where negotiation dynamics can vary, it’s crucial not to assume sellers won’t negotiate, even in a buyers’ market. Christopher Sileno, our Head Architect, advises buyers on the potential for negotiating concessions with sellers. For example, he has successfully negotiated deals where sellers cover the cost of solar panels, ensuring that the buyer acquires both the house and the panels without any additional financial burden. In one notable instance, this type of negotiation resulted in CHF 60,000 in savings for the buyer.
Christopher highlights, “Many sellers are more flexible than you might expect, especially when faced with well-presented market data. As a buyer, it’s easy to accept a quick ‘no’ from a seller because buying a home is often an emotional decision. However, our role is to step in and negotiate on your behalf. By leveraging local market insights, such as previous concessions made by neighbors, we can make a compelling case to the seller. Demonstrating what others in the community have agreed to can be a powerful negotiating tool.”
3. Find an experienced agent who has good customer reviews
Urs Ruprecht, Regional Manager West, emphasizes the importance of partnering with an experienced real estate agent who understands the nuances of the local market and can employ various strategies to save you money on the purchase price, closing costs, and even post-purchase expenses like home repairs and moving.
Urs, who is known for his expertise and tailored advice in real estate, stresses the value of carefully selecting an agent. “In every market, the dynamics vary, and the strategies that work in a seller’s market might not be effective in a buyer’s market,” he explains. He advises potential buyers to thoroughly research their agents, checking their transaction volumes, client reviews, and overall market success.
“A lot of agents might only handle a few transactions per year. As someone considering entering this market, it’s crucial to ensure your agent is not only experienced but also highly regarded by previous clients,” Urs states. He offers a unique assurance to buyers: if they are not satisfied with their purchase, he will facilitate the sale of the property at no cost or buy it back himself, demonstrating his commitment to client satisfaction and confidence in his market strategies.
4. Line up financing early so you’re prepared for different interest rate scenarios
Sven Ortega-Bieri, Head of Financing at the Swiss Property Owners Association, understands that discussions about finances, especially with banks, can be daunting, particularly for first-time homebuyers. “Approaching a bank for a mortgage discussion can be intimidating, but even a brief conversation can reveal much about your potential to finance a home,” he explains.
Sven encourages those who may not be ready to buy immediately to start planning early. “By setting up a strategic plan and outlining clear action items, we can position you advantageously for future purchases,” he notes. He believes in educating buyers about the various costs involved in buying a home, from down payments to closing fees, ensuring they move forward with confidence.
“Understanding all financial aspects of buying a home can demystify the process and remove the anxiety that comes with large financial commitments,” Sven adds. He also highlights the importance of getting pre-approved for a mortgage, which not only clarifies your budget but also strengthens your position when you’re ready to make an offer. With Sven’s guidance, buyers are equipped to navigate the complexities of the Swiss real estate market, ensuring a smoother and more informed purchasing journey.
5. Evaluating Renovation Projects Versus Move-In Ready Homes in Switzerland
Christopher Sileno, our lead Architect at the Swiss Property Owners Association, underscores the potential advantages of investing in a renovation project to achieve desirable features such as location, square meters, or a specific layout without paying the premium that typically accompanies move-in ready homes. “While a turnkey home offers immediate convenience, that convenience is often reflected in the price,” he points out.
However, Christopher also highlights essential considerations when contemplating fixer-uppers. “In Switzerland, financing decisions are based on the property’s current condition, not on its anticipated value after improvements. It’s important that the purchase price reflects this reality to ensure that you can secure a mortgage and also afford the necessary renovations,” he explains.
Christopher further advises on the importance of strategic planning during renovations. “Having a well-defined vision for the space and selecting cohesive finishes are key. These decisions can greatly influence the home’s ultimate resale value,” he says.
For novices to property renovation, Christopher recommends starting small. “If it’s your first renovation project, consider a property that needs only cosmetic updates. This way, you can live in your home comfortably while making smaller enhancements over time, such as new fixtures or a fresh coat of paint. This approach not only eases you into renovations but also helps maintain a manageable living situation,” he advises.
6. Consider different home types, including new construction
7. Know when to compromise on home features and desired neighborhoods
Céline Blaser, Senior Real Estate Expert at the Swiss Property Owners Association, acknowledges the challenges buyers face in matching their desires with reality in the Swiss real estate market. “No matter your budget, it’s rare to find a property that ticks every box on your dream list,” she explains. “I’ve assisted countless buyers, and there’s invariably some compromise involved. It’s crucial to define your search criteria early on and decide what you’re willing to prioritize.”
Céline notes that preferences vary significantly among buyers—some prioritize location above all, while others may value the perfect layout or a stunning view. “If you’re struggling to find the right property in the ideal location at an acceptable price, it might be necessary to adjust your expectations regarding what’s available in your preferred area or consider expanding your search to include nearby regions. It’s important to act decisively, as prices in emerging areas won’t remain low indefinitely.”
Understanding which features are essential and which are merely desirable can significantly aid in making these decisions. Céline suggests creating a detailed list of must-haves versus nice-to-haves as a practical step towards narrowing down options and making informed compromises. This approach not only streamlines the search process but also prepares you to quickly make decisions in Switzerland’s competitive property market.
8. Consider Investing in Properties with Rental Potential or Multi-Family Homes
Dominique Julen, Head of Investment Real Estate, emphasizes the strategic advantage of purchasing a multifamily property in Switzerland. “Investing in a property where you can live in one unit and rent out the others can be an excellent first investment,” he suggests. This approach allows you to benefit from lower down payments and interest rates typically associated with owner-occupied loans, while rental income helps offset mortgage costs.
“Although such properties might not meet all your personal space desires, they provide a significant financial leverage by reducing monthly expenses, thereby freeing up capital for future investments,” Dominique explains.
However, Dominique also warns of the complexities involved in being a landlord. “Managing rental properties is not without its challenges,” he advises. “It’s essential to understand the legal aspects of leasing. I strongly recommend consulting with an attorney who specializes in landlord-tenant law in Switzerland to ensure all interactions with tenants are conducted properly, from leases to any notices that need to be served.”
This approach not only helps secure your investment but also ensures that you remain compliant with Swiss rental regulations, safeguarding both your rights and those of your tenants.
9. Keep on eye on homes that have lingered on the market
Marco Noth, Head of Real Estate Valuation, highlights an often-overlooked strategy in the home buying process, particularly in Switzerland’s dynamic real estate market. While new listings often stir excitement and draw immediate attention, it’s the properties that have been on the market for an extended period that may present real opportunities.
“Properties that initially appear on the market with a high price tag, poor marketing materials, or inadequate staging can often be overlooked,” Marco explains. “These homes might not make the best first impressions, but they frequently represent hidden gems that could be acquired below market value once their initial listings fail to attract buyers.”
Marco advises maintaining a balanced approach when searching for a home. “While it’s important to keep up with new listings, don’t neglect homes that have been on the market longer. They often provide a chance to negotiate a better deal, especially if they’ve seen price reductions.”
In addition to recognizing potential in these listings, Marco suggests a proactive approach: “Engage with a professional to assess the real value of these properties. This can help you understand the cost of potential renovations or changes needed to transform an overlooked property into your ideal home.”
By employing this strategy, buyers can leverage the less competitive nature of older listings to secure favorable terms and potentially find a property that offers significant value for money in the Swiss real estate market.
